Home prices fall for seventh month yet …
Gold and Silver hit record highs again
| All that free and easy new money for insiders is upping prices, guiding investors into gold, but land has not finished moving the other way. We trim, blend, and append three 2011 articles from: (1) MarketWatch, Apr 7, on gold by Claudia Assis, (2) USA Today, Apr 5, on the Fed by Matt Krantz; and (3) MarketWatch, Apr 7, on home prices by Alistair Barr. |
by Claudia Assis, by Matt Krantz, and by Alistair Barr
- Gold cinches third record high in a row
Gold hit record highs, its third consecutive, and helped silver, the poor man’s gold, reach another 31-year high close.
Momentum buying, heightened concerns about debt problems in Europe, fears of inflation, and even an aftershock in earthquake- and tsunami-ravaged Japan contributed to gold’s top showing.
Gold for June delivery added 80 cents, less than 0.1%, to settle at $1,459.30 an ounce on the Comex division of the New York Mercantile Exchange. The contract, gold’s most active, climbed as high as $1,466.50 an ounce earlier.
May silver added 16 cents, or 0.4%, to $39.55 an ounce. Silver has closed higher four sessions in a row.
Silver and gold’s recent runs are a response to geopolitical challenges and loose monetary policy.
To see the whole article, click here .
JJS: “Loose monetary policy”, which means creating and issuing more new currency than an equivalent amount of new goods and services from producers, is what makes possible -- even inevitable -- inflation throughout an entire economy. It’s the official policy of the US Federal Reserve.
- What exactly does the Federal Reserve do, anyway?
Secretive societies wielding lots of power are usually the subject of a Dan Brown novel. But one such group is the Board of Governors of the Federal Reserve System, or Fed for short. The six members of the board, including Chairman Ben Bernanke as well as Janet Yellen, Kevin Warsh, Elizabeth Duke, Daniel Tarullo and Sarah Bloom Raskin, hold tremendous sway over US financial life.
In addition to the Board of Governors, appointed by the President for 14-year terms, there’s also a 12-member Federal Open Market Committee, which includes the typical seven people who sit on the Board of Governors. There are also 12 regional presidents who represent the regional Federal Reserve Banks across the US.
The Fed’s stated mandate is to “provide the nation with a safe, flexible, and stable monetary and financial system.” It alters the money supply and the rates it sets for its bonds affect lending rates for almost all other borrowing. Such power gives the Fed the influence to move the stock market, adjusting the values of investor’s 401(k) balances, pension plans, and college savings plans.
The Fed operates independently of the US government; it needs no approval for its decisions from any branch of the government. The Fed, though, must testify to Congress periodically. The government also receives any profits the Fed may earn, although the goal of the Fed is not to make money for itself.
It’s pretty common for investors and economists to praise, criticize, and condemn the Fed and debate its value, whether or not its appropriate for a small group of people to have so much economic power and whether paper currency is a bad idea.
To see the whole article, click here .
JJS: While the Fed does not turn a profit for itself, it does for its cronies -- big banks and big business -- when it bails them out or lends them money at rates below what their competitors must pay.
As for the tasks the central bankers have given themselves, is it possible for a few insiders to know how much new currency a massive economy needs, or how high or low to set lending rates? Aren’t those feats that a freed market including independent, honest, and competing banks would perform routinely?
How is the Fed doing in its effort to maintain the value of the dollar? Want to see what a dollar could buy today vs. back when the Fed was founded? Or, in other words, how much is the cost of living now vs. then? click here . The organization was started years ago by an army officer sympathetic to the views of the great populist economist of the late 1800s, Henry George.
While the Fed fails to keep up the value of the dollar or job opportunity for workers, the economy is getting better anyway. The economy is a cyclical phenomenon, like the weather or ecosystems or living bodies, and expands and contracts naturally. Now it’s beginning to grow again, as land becomes affordable.
Most media put affordable land in a bad light. But most media also refer to locations -- the part of property that fluctuates in price -- as “housing”. Don’t be misled; keep your eye on the “rents” -- that’s our commonwealth.
- Home prices fall for seventh month in February
Home prices fell for a seventh straight month in February as a wave of distressed properties continued to wash over the US market.
CoreLogic’s national home price index dropped 6.7% in February, versus the same month a year earlier.
The decline was bigger than the January index reading, which was 5.5% lower than a year ago.
More than three years since house prices began to fall in the US, the market is still slowly absorbing millions of properties that are in foreclosure or other stages of distress.
Excluding distressed sales, home prices fell 0.1% in February, compared to a year earlier.
To see the whole article, click here .
JJS: In a way, I’ll be sad to see affordable prices go and growth return, not knowing just how much more growth -- with its pollution of the environment and depletion of resources -- that the planetary ecosystem can endure. Better than an economy always trying to expand, we could have a steady-state economy. But first, we’d have to replace taxes with land dues and subsidies with a Citizens’ Dividend. Even if we adopted this geonomics for non-green reasons, it’d still improve wages, halt inflation, and make our lives better.
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Editor Jeffery J. Smith runs the Forum on Geonomics.
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Also see: World's rich got richer, so how about a break?
Homes are cheaper, but not necessarily affordable
Home builders' index & Jobs numbers Both down |
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